Babatunde Fashola, a former minister of works and housing, believes the national assembly may have unconstitutionally legislated on wages instead of the minimum wage.
In a post titled ‘Minimum Wage Review – My Takeaway’, Fashola stated that the country’s minimum wage is one of the items on the constitution’s exclusive legislative list.
A salary is a predetermined amount paid over a certain time, whereas a wage is paid hourly.
Because of rising inflation, organised labour has recently demanded an increase in the minimum wage to N30,000.
While the federal government has proposed to pay N62,000, labour groups have demanded N250,000.
Fashola stated that the constitution should be altered to allow for the establishment of minimum wages for workers.
Fashola said:
“In my recent monograph, ‘The Nigerian Public Discourse: The Interplay of Empirical Evidence and Hyperbole’, I made the point on page 89 that the word used in item 34 of the Exclusive Legislative list is minimum wage.”
“It does not talk about salaries. I further stated that ‘…it has also been shown, that wages and salaries are different and should not be conflated.’ I posited that ‘…efforts to improve minimum wage must be that and nothing more. It must not translate to a salary overhaul by accident.
“Therefore, it seems obvious from this definition that by making a law in Section 3(1) of the Minimum Wage Act that the minimum wage of N30,000 shall be paid monthly, the NASS may have acted unconstitutionally by legislating on a SALARY (monthly payment) when they only have power to legislate on WAGES, an hourly payment.
“This is important while the conversation on minimum wage is being had in 2024 because in Section 3(4), the minimum wage ‘shall be reviewed in line with the provisions of this Act’ which includes Section 3(1) that has prescribed a monthly amount instead of an hourly wage.
“If we follow the proper definition of wages as an hourly rate and apply the global method for computing it, which is to divide the gross annual sum by 52 weeks, and further by 40 hours recommended per week, we will have for Nigeria a minimum wage that is not N30,000 per month, but rather N30,000 X 12 (months) = N36,000 divided by 52 (weeks) = N6,923.07 divided by 40 (hours), which will give a minimum wage of N173.07 per hour.
“What we have done is to erroneously fix monthly minimum salaries as wages, and then effect consequential adjustment for all other SALARY EARNERS, which results in a bloated compensation wage that employees find difficult to meet.”
The former Lagos governor stated that both high and low-income earners deserve salary and compensation changes due to the rising cost of living.